MBS RECAP: Jobs Report and ISM Data Push Back, But Not Too Much

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Posted To: MBS Commentary

Bonds were stronger overnight, riding a wave of buying demand on the heels of yesterday's weak econ data and US/China trade deal uncertainty. Some market participants were said to be looking for a looking for an NFP number that was even lower than the already low forecast of 89k. While that didn't make much sense to me personally (in fact, I felt forecasts were overestimating the impact of the UAW strike), I'll never turn down a good bond rally. NFP ended up doing what we feared it might by coming in at 128k vs the 89k forecast. Internals were decent enough and bonds were suddenly tasked with the need to make a quick correction toward higher yields. The correction lasted all o f 8 minutes before yields began drifting back toward the pre-NFP lows. By the time the 10am ISM Manufacturing…(read more)

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